Putting a brake on FTA

Korea Times, Feb 5, 2012 —

Putting a brake on FTA – DUP should present realistic alternatives

The opposition Democratic United Party appears set to scuttle the Korea-U.S. Free Trade Agreement by any means. The DUP will ask the U.S. president and Congress to suspend the implementation of the KORUS FTA, and go as far as to “break” it if the liberal party wins in a presidential election in December.

It is doubtful whether the U.S. leaders would accept the Korean oppositionists’ request. Nor is it certain the DUP would actually scrap the free trade accord even if takes power.

What is certain, however, is the largest opposition party can hardly avoid popular criticism of self-denial. Most DUP leaders were once staunch supporters of the FTA with America, which was initiated and concluded by their deceased boss, former President Roh Moo-hyun.

The opposition politicians argue the original agreement has sharply deteriorated through the renegotiations by the incumbent administration.

As to the controversial attitude change concerning some “poisonous” clauses, including the Investor State Dispute (ISD) settlement system, these politicians confess they should have known better back then, revealing their own ignorance or insincerity, or both five years ago. Even if all their arguments prove true, they owe a big, official apology to voters for causing confusion.

This paper has called for a more cautious approach to moving toward completely unrestrained trade with the world’s largest economy, not least because the KORUS FTA is not just about tariff-free trade but a matter that can change the nation’s economic and even social environment into the neo-liberalistic U.S. system based on market-is-everything competition and brutal economic industrial and economic polarization between strong and weak sectors and components.

Yet the annulment of the entire treaty for partial defects could tarnish this country’s reputation as an international player. It will not be too late for such drastic actions if Seoul sounds out all possibilities for the renegotiation of problematic parts in which Korea’s national interests are severely compromised after letting the accord go into effect as scheduled.

This is important because Korea should resort to foreign trade as its biggest growth engine, although it will increasingly depend on domestic demand.

A more realistic and urgent task for politicians is how to make the most of the freer trade and larger markets, while minimizing the domestic conflicts by correcting the imbalance between the winners and losers. Politicians’ promises with voters need to be more careful especially in an election year.